Now replace me, says Co-op chief Ursula Lidbetter after members back reforms to modernise the troubled mutual

Ursula Lidbetter, chair of the Co-operative Group, is to make finding her own replacement her top priority after delegates to a special meeting voted for sweeping reforms to the organisation’s board.

Hailing yesterday’s vote as a ‘momentous and defining moment’ for the Co-op, Lidbetter said the new chairman was crucial as they would implement the reforms.

The meeting in Manchester voted 83 per cent in favour of the reform package to see the group’s board shrunk from 20 to 11 members.

Reforms: The group's business focus will now be on its core supermarkets

Alongside two executive officers the board will be dominated by five independent non-executives including the new chairman, plus three directors nominated by members.

The system replaces a board almost entirely elected from members, a system discredited after the Co-op plunged into financial crisis last year. It will also create a 100-strong council elected by all members.

Lidbetter supported the reforms but under the changes would not be eligible to chair the new board.

Richard Pennycook, acting chief executive, would not be drawn on whether he would be a candidate for the permanent role, saying he would be ‘happy to go back’ to his previous position as chief operating officer.

Pennycook has been acting chief executive since Euan Sutherland dramatically quit the group last year amid bitter infighting over the reforms.

The group will now hope to draw a close on more than a year of turmoil, sparked by the £1.5billion crisis at the Co-operative Bank, later fuelled by revelations of drug use by Paul Flowers, chairman of the bank and deputy chairman of the group.

The Co-op has been forced to hand control of its bank to creditors including US hedge funds, though it retains a minority stake. It has also sold its farming and pharmacies businesses to plug funding gaps.

The group’s business focus will now be on its core supermarkets. Half year figures, due next week, are expected to show the retail business, is suffering from the fierce competition in the grocery market.